Nepra to hear Chinese company's petition for hike in EPC cost on Dec 1.

ISLAMABAD -- National Electric Power Regulatory Authority will hear the petition of CIHC Pak Power Company Limited (CPPCL) for a hike in EPC (engineering, procurement and construction) cost of 300MW Gwadar coal-fired power project to $403 million (up by 25.38 percent) on December 1. In its petition for modification/revision in tariff for 300MW coal-fired project in Gwadar, the company has also sought 21.43pc hike in return on equity (RoE) and requested the regulator to allow upward adjustment of Internal Rate of Return (IRR) to 17pc from the earlier determined 14pc. As per the petition submitted to NEPRA, the Chinese company has requested an increase of $82 million in EPC cost. CIHC Pak Power Company Limited (CPPCL) is setting up the 300MW coal-fired power plant in Gwadar, Balochistan. The company had requested a hike of 25.38pc in the EPC cost of the project from the earlier revised determined $321.41 million to $403 million. Originally, NEPRA had allowed EPC of $236.13 million for Gwadar coal project, which was later revised to $321.41 million. Now, the Chinese company wants another upward revision in the cost. The petitioner also requested the regulator to remove the provisions limiting the project cost indexation to a specific PKR rate i.e. 105/USD. The CPPCL requested that Sinosure fee at actual under a Buyers Credit Insurance be allowed subject to maximum of 7pc of debt servicing. The petition requested the authority to include the financial guarantee as part of the annual recurring costs at rate of 0.9pc of the guaranteed amount applicable in a particular year. The Chinese company sought an increase in the project development and sponsor's cost to $47.87 million against the allowed amount of $10.50 million. The petition requested that the API-4 may be kept as the base index for the determination of coal price as outlined in the authority's fuel pricing mechanism dated 23rd September 2016. The petition also sought clarification on taxes and duties. The petition requested to allow increase in O and M cost of $17.43 million against allowed amount of $12.71 million. The company has also requested for allowing Buyer's Credit Policy for Sinosure fee. Earlier, in the revised determination, NEPRA had allowed Overseas Investment Insurance Policy. In its original petition, the petition requested $369.89 million on account of EPC comprising offshore portion of $250.16 million and onshore portion of $119.73 million. The EPC cost includes costs...